The power of an “engaged” community.
I know what you are thinking at that headline- what? I’m sure you did a double take, and asked yourself if I’m actually out of things to write about, when you saw it. And at first glance, it probably seems like the most ridiculous, logically incoherent statement ever- the potential for long term success of an upcoming console was already demonstrated by a controller? How?
But I am sure that even as you repeated the statement to yourself in incredulity, or probably as you read the preceding paragraph, it might have begun to occur to you- the Xbox One Elite Controller may actually be the greatest barometer we have for the long term success of the Xbox One X.
The Xbox One Elite Controller, when it was first revealed, was pitched as a truly impressive, high end piece of kit for the true gaming enthusiast. It looked fantastic, and it looked like Microsoft had managed to make yet another great controller- until the price was announced to be a ridiculous $150.
"The Xbox One Elite Controller sold beyond expectations, and continues to to this day, in spite of its price."
$150 for a game controller: who would spend that kind of money? For a bit above $150, you could get yourself three new games, more used ones, three regular controllers, three years of online play, a brand new Nintendo 3DS, a brand new PS Vita, or even a used Wii U- and this is just sticking to games. Why in the world would anyone spend that kind of money on a controller? The Xbox One Elite Controller looked great, yes- but $150 great?
Apparently, it was $150 great, because it went on to be a great success, exceeding even Microsoft’s expectations. Microsoft, perhaps sensibly, had not produced many units of the thing, presumably expecting it to not sell all that much owing to its price- but it ended up selling out, with there being so much demand for it that it was backordered for months. The Xbox One Elite Controller sold beyond expectations, and continues to to this day, in spite of its price.
This brings us to the greatest advantage Xbox has- not its strong showing on the services front, not the hardware, not the marketing, and certainly not the exclusives. No, Xbox’s biggest advantage is its highly engaged fanbase.
User engagement matters- ultimately, a customer can end up purchasing expensive hardware, but there is no further revenue (or any revenue if that hardware was sold at a loss, like so much hardware often is) if the user does not keep spending money on it. That money comes from games, accessories, and services like online play. Engaged userbases usually lead to typically high subscription numbers, and huge attach ratios, while disengaged userbases often lead to disappointing attach rates and software sales even when the hardware has sold a lot.
"An engaged userbase means that userbase will buy games; subscribe to services; invest in the platform, no matter how expensive things might get. That’s how Microsoft sold a $150 controller- and that is how they might sell a $500 console as well."
Userbase engagement is something Microsoft has thrived at for years- they started with the original Xbox, with Halo 2 and the original Xbox Live paving the way, and creating a community, something that carried over to the Xbox 360, where Microsoft built an even bigger community of gamers. And even on the Xbox One, amidst all of their total lack of direction and coherence when it comes to their lineup of exclusives, they have managed to keep their community consistently engaged. People like to make fun of Major Nelson and Phil Spencer, and their constant interactions with their community, but it is just one way of keeping their userbase engaged- and that user engagement goes a long way, as the consistently high subscription numbers for Xbox services, and high sales for games and accessories, demonstrate.
An engaged userbase means that userbase will buy games; subscribe to services; invest in the platform, no matter how expensive things might get. That’s how Microsoft sold a $150 controller- and that is how they might sell a $500 console as well. Because even if their install base is small– and it is smaller than the PlayStation install base- it is an engaged install base.
This is an advantageous track to take for Microsoft as well- even as their hardware sales go down, they have managed to find a way to remain profitable and generate revenues, simply by monetizing their existing userbase more. Microsoft wins, because it manages to do well even when by traditional metrics, it is not. Xbox fans win, because they are getting more from the platform they love. And if they want to spend $150 on a controller, or $500 on a console, who are we to tell them otherwise? I have already discussed how, as great as the Xbox One X is, I don’t think it is worth $500- but value is an inherently personal and subjective thing. It may not be worth it to you, me, or anyone on the outside- but if an Xbox fan decides that the Xbox One X is worth $500 to them, who are we to tell them otherwise?
So here we are- the Xbox One X is already known to be doing well in terms of pre-orders, but questions about its long term viability exist and remain. I don’t know how much the Xbox One X might do going forward- but I do know that there is precedence for even a pricey, niche piece of high end Xbox hardware to end up doing unexpectedly well.
The Xbox One X may end up doing that, too.
Note: The views expressed in this article are those of the author and do not necessarily represent the views of, and should not be attributed to GamingBolt as an organization.